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Japanese Yen hangs near four-decade low as bears turn cautious amid intervention risks

  • USD/JPY struggles to gain any meaningful traction amid mixed fundamental cues.
  • Intervention risks hold back the JPY bears from placing fresh bets and cap spot prices.
  • The wide US-Japan rate gap and rising US-Iran tensions act as a tailwind for the pair.

The USD/JPY pair seesaws between tepid gains/minor losses during the Asian session on Monday and currently trades just below mid-162.00s amid relatively thin liquidity on the back of a holiday in Japan. Nevertheless, spot prices remain close to a four-decade high, touched earlier this July, though bulls seem hesitant amid speculations that Japanese authorities will step in to prop up the Japanese Yen (JPY).

Japan’s Finance Minister Satsuki Katayama said on Friday that the government will take decisive action at any time if it becomes necessary. Despite the warning of possible intervention in the currency market, the JPY continues with its struggle to attract any meaningful buyers amid the wide rate differential between Japan and other major economies, which keeps the so-called carry trade active. Apart from this, economic risks stemming from the Middle East crisis continue to undermine the JPY, which, along with a modest US Dollar (USD) strength, acts as a tailwind for the USD/JPY pair.

Given that Japan relies on the Middle East for over 90% of its crude oil, investors are increasingly worried that the economy will remain under strain due to escalating US-Iran tensions and supply disruptions in the Strait of Hormuz. In fact, the US military said that it carried out a ninth straight night of strikes against Iran aimed at degrading its capabilities used to attack commercial vessels and civilian mariners transiting the strategic waterway. Moreover, US allies in the region reported a new wave of attacks on Sunday, prompting traders to continue to price in the geopolitical risk premium.

Meanwhile, US-Iran hostilities benefit the safe-haven USD amid concerns that rising crude oil prices would revive inflationary pressures and force the US Federal Reserve (Fed) to adopt a more hawkish stance. According to the CME Group’s FedWatch Tool, traders are still pricing in the possibility of at least one interest rate hike by the Fed in 2026. This, in turn, favors the USD bulls and backs the case for a further near-term appreciating move for the USD/JPY pair. Hence, any corrective pullback could be seen as a buying opportunity and is more likely to be limited.

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EUR/JPY Price Holds above nine-day EMA support at 185.50

  • EUR/JPY may find immediate resistance at the ascending triangle top near 186.10.
  • The 14-day Relative Strength Index of 55.33 signals healthy bullish momentum that is not yet overextended.
  • The initial support lies at the nine-day EMA at 185.50.

EUR/JPY remains subdued for the third consecutive day, trading around 185.80 during the Asian hours on Monday. The currency cross is holding a constructive bullish bias as it stays above both the nine-day and 50-day Exponential Moving Averages (EMAs), now aligned as nearby dynamic support.

The 14-day Relative Strength Index (RSI) at 55.33 leans to the upside without signalling overbought conditions, suggesting bullish momentum is present but not yet overstretched while price consolidates just under the recent highs.

The daily chart technical analysis shows the EUR/JPY cross is remaining within the ascending triangle, at the top near 186.10. This flat ceiling, combined with shallower dips, signals aggressive buying pressure. A decisive break above the triangle could trigger a powerful bullish continuation, which could expose the all-time high of 187.95, which was recorded on April 17.

On the downside, primary support lies at the nine-day EMA at 185.50, followed by the 50-day EMA at 185.12 and the ascending triangle’s lower boundary around 185.00. A break below the triangle would weaken the bullish bias and put downward pressure on the EUR/JPY cross to navigate the region around the five-month low of 181.87, recorded on March 16, and the seven-month low of 180.81.

Chart Analysis EUR/JPY
EUR/JPY: Daily Chart

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the New Zealand Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD-0.01%-0.07%-0.02%-0.09%-0.15%-0.24%0.02%
EUR0.01%-0.02%0.00%-0.08%-0.13%-0.25%0.03%
GBP0.07%0.02%0.02%-0.06%-0.11%-0.21%0.04%
JPY0.02%0.00%-0.02%-0.06%-0.13%-0.19%0.03%
CAD0.09%0.08%0.06%0.06%-0.06%-0.12%0.09%
AUD0.15%0.13%0.11%0.13%0.06%-0.08%0.18%
NZD0.24%0.25%0.21%0.19%0.12%0.08%0.22%
CHF-0.02%-0.03%-0.04%-0.03%-0.09%-0.18%-0.22%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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Japanese Yen softens on renewed US-Iran tensions, Japan flags intervention risk

  • USD/JPY trades with mild gains around 162.40 in Friday’s Asian session. 
  • The US is carrying out major strikes on Iran for the sixth consecutive day, lifting the US Dollar. 
  • Japan’s Katayama said authorities are ready to act on currency moves whenever necessary. 

The USD/JPY pair posts modest gains near 162.40 during the Asian trading hours on Friday. The US Dollar (USD) strengthens against the Japanese Yen (JPY) as the United States (US) launches a new wave of strikes against Iran for a sixth night in a row. Traders will keep an eye on the preliminary reading of the Michigan Consumer Sentiment Index for July later on Friday. 

The US Central Command (CENTCOM) said on Thursday that it launched a new wave of strikes against Iran for a sixth night in a row, per the BBC. The US military said that the attacks were intended to “further degrade Iranian military capabilities” before saying it had boarded a vessel as part of its blockade of the Strait of Hormuz.

Iran’s state media reported US missiles struck close to the island of Qeshm, near the strait, as well as in Bandar Abbas and Bushehr, the site of a nuclear power plant. Earlier this week, US President Donald Trump threatened to strike Iran’s bridges and power plants if the country did not return to talks. Renewed Hormuz hostilities could boost the Greenback against the JPY in the near term. 

Kyodo News Agency reported on Friday that the Japanese government will state in its economic blueprint that decisions on specific monetary policy tools should be left to the Bank of Japan (BoJ). A final version of the blueprint will also state that the government will reach a decision “by early August” on whether and by how much Japan will cut 8% consumption tax levied on food.

Traders remain on alert for possible intervention from Japanese officials. Japan’s Finance Minister Satsuki Katayama said on Friday that the authorities are ready to act on currency moves whenever necessary. 

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EUR/JPY Price Remains below ascending triangle top near 186.00

  • EUR/JPY may find immediate resistance at the ascending triangle top near 186.00.
  • The 14-day Relative Strength Index is at 55.17, indicating steady, sustainable bullish momentum.
  • The currency cross could find the initial support at the nine-day EMA at 185.42.

EUR/JPY extends its losses for the second consecutive day, trading around 185.70 during the Asian hours on Friday. The currency cross is holding above both the nine-period and 50-period Exponential Moving Averages (EMAs), which reinforces a constructive near-term bias. The 14-day Relative Strength Index (RSI) sits at 55.17, neutral-to-positive territory, suggesting steady bullish momentum rather than an overstretched rally.

The daily chart technical analysis shows the EUR/JPY cross is pressing against ascending triangle resistance near 186.00. This flat ceiling, combined with shallower dips, signals aggressive buying pressure. Because bulls are consistently absorbing the supply at this level, momentum is heavily building for an imminent upside breakout. A decisive daily close above this upper boundary typically triggers a powerful bullish continuation, which could expose the all-time high of 187.95, which was recorded on April 17.

On the downside, primary support lies at the nine-day EMA at 185.42, followed by the 50-day EMA at 185.09. Further declines would put downward pressure on the EUR/JPY cross to test the ascending triangle’s lower boundary around 184.80. A break below the triangle would expose the four-month low of 181.87, recorded on March 16, and the six-month low of 180.81.

EUR/JPY: Daily Chart

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD0.02%0.06%0.00%-0.04%0.12%0.04%0.00%
EUR-0.02%0.06%-0.04%-0.09%0.13%0.03%-0.02%
GBP-0.06%-0.06%-0.09%-0.14%0.06%-0.02%-0.08%
JPY0.00%0.04%0.09%-0.03%0.15%0.04%0.01%
CAD0.04%0.09%0.14%0.03%0.19%0.09%0.05%
AUD-0.12%-0.13%-0.06%-0.15%-0.19%-0.11%-0.14%
NZD-0.04%-0.03%0.02%-0.04%-0.09%0.11%-0.04%
CHF-0.00%0.02%0.08%-0.01%-0.05%0.14%0.04%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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AUD/JPY Price Declines below 113.50, while maintaining bullish near‑term structure

  • AUD/JPY softens to near 113.45 in Thursday’s early European session. 
  • The cross maintains a constructive outlook, with bullish RSI momentum. 
  • The immediate resistance level is seen at 113.70; the initial support level to watch is 112.65. 

The AUD/JPY cross trades in negative territory around 113.45 during the early European trading hours on Thursday. Verbal intervention from Japanese authorities provides some support to the Japanese Yen (JPY) against the Australian Dollar (AUD). 

Japan’s Finance Minister Satsuki Katayama said on Thursday that the authorities are ready to take appropriate action on currency anytime as needed. She added that the officials will track market trends and economic data to ensure fiscal sustainability.

Senior officials from the Bank of Japan (BoJ) noted that a delay in stimulus adjustment amid high inflation risk could trigger an economic downturn. However, a Reuters survey showed earlier Thursday that nearly half of Japanese firms are experiencing negative business impact from the BoJ’s interest rate hikes, with higher borrowing costs hurting bottom lines and discouraging capital investment. 

Chart Analysis AUD/JPY

Technical Analysis:

In the daily chart, AUD/JPY holds a bullish near-term bias as price remains above the 100-day Simple Moving Average (SMA) and the Bollinger Bands 20-period middle band, suggesting the broader uptrend is still supported despite recent consolidation. The latest Relative Strength Index (14) reading around 57 keeps momentum on the constructive side, hinting that buyers retain control as long as the pair stays comfortably above the lower Bollinger band at 111.10.

On the topside, initial resistance emerges at the Bollinger upper band around 113.70, where a sustained break would open the door to the May 13 high of 114.74.

On the downside, the first layer of support is seen at the 100-day SMA at 112.65, followed by the Bollinger middle band near 112.40, while a deeper pullback towards the lower band at 111.10 would be needed to seriously challenge the prevailing bullish structure.

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Japanese Yen strengthens on intervention warning, cooling US inflation

  • USD/JPY edges lower to around 162.15 in Thursday’s Asian session. 
  • Japan’s Katayama said ready to take appropriate action on currency anytime as needed. 
  • Cooling US inflation curbs Fed rate hike bets. 

The USD/JPY pair loses ground to near 162.15 during the Asian trading hours on Thursday. The Japanese Yen (JPY) strengthens against the US Dollar (USD) after verbal intervention from Japanese authorities. Traders await the release of the US June Retail Sales data later on Thursday for fresh impetus. 

Traders remain on alert for possible intervention from Japanese officials. On Thursday, Japan’s Finance Minister Satsuki Katayama said that the authorities are ready to take appropriate action on currency anytime as needed. She added that the officials will track market trends and economic data to ensure fiscal sustainability. 

Softer-than-expected US inflation data reinforced bets that the US Federal Reserve (Fed) can stay ‌patient on interest rate hikes, weighing on the Greenback. Data released by the US Bureau of Labor Statistics (BLS) on Wednesday showed that the US Producer Price Index (PPI) rose by 5.5% YoY in June, versus 6.0% in May (revised from 6.5%). This reading came in below the market consensus of 6.2%. 

On a monthly basis, the PPI declined by 0.3%, compared to the 0.6% increase recorded in May (revised from 1.1%) and improved compared with the estimate for no change.

The probability for a rate hike in July was slashed to 9.6%, versus a 45% implied ‌probability at the start of the week. Markets still see even odds of at least a 25 basis points (bps) increase in September, according to the CME FedWatch tool. 

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EUR/JPY Price Positions near ascending triangle top around 186.00

  • EUR/JPY near the 186.10 ascending triangle ceiling suggests building bullish pressure.
  • The 14-day Relative Strength Index at 56 indicates positive, sustainable upward momentum.
  • The currency cross could find the initial support at the nine-day EMA at 185.35.

EUR/JPY depreciates after three days of gains, trading around 185.90 during the Asian hours on Thursday. The currency cross is retaining a constructive bullish bias as it holds above both the nine-period and 50-period Exponential Moving Averages (EMAs). The 14-day Relative Strength Index (RSI) around 56 suggests positive but not overextended momentum, hinting that buyers still control the near-term tone.

The daily chart technical analysis shows the EUR/JPY cross positioning near the upper boundary of an ascending triangle around 186.10, suggesting that price crowding right against that flat ceiling indicates that buyers are aggressively absorbing all selling pressure at that level. This positioning shows immense bullish pressure. Since the dips are getting shallower, staying near the top suggests a breakout above resistance is likely building up.

A decisive daily close above this upper boundary typically triggers a powerful bullish continuation, which could expose the all-time high of 187.95, which was recorded on April 17.

On the downside, primary support lies at the nine-day EMA at 185.35, followed by the 50-day EMA at 185.05. Further declines would put downward pressure on the EUR/JPY cross to test the ascending triangle’s lower boundary around 184.70. A break below the triangle would expose the four-month low of 181.87, recorded on March 16, and the six-month low of 180.81.

Chart Analysis EUR/JPY
EUR/JPY: Daily Chart

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Japanese Yen.

USDEURGBPJPYCADAUDNZDCHF
USD0.00%0.12%-0.05%0.08%0.09%0.12%0.11%
EUR-0.00%0.11%-0.04%0.08%0.19%0.13%0.10%
GBP-0.12%-0.11%-0.15%-0.02%0.06%0.02%0.00%
JPY0.05%0.04%0.15%0.09%0.20%0.16%0.15%
CAD-0.08%-0.08%0.02%-0.09%0.10%0.07%0.05%
AUD-0.09%-0.19%-0.06%-0.20%-0.10%-0.01%-0.05%
NZD-0.12%-0.13%-0.02%-0.16%-0.07%0.01%-0.03%
CHF-0.11%-0.10%-0.01%-0.15%-0.05%0.05%0.03%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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Senior BoJ official: Delay in adjustment amid high inflation risk could trigger economic downturn

Senior officials from the Bank of Japan (BoJ) said on Thursday that a delay in stimulus adjustment amid high inflation risk could trigger an economic downturn. 

Key quotes

Delay in stimulus adjustment amid high inflation risk could trigger economic downturn. 

Suitable monetary policy would ensure stable inflation, place economy on sustainable growth trajectory. 

When upside inflation risk high as is the case now, delay in adjusting degree of stimulus could materialise such risk, lead to economic downturn in future.

Market reaction 

At the time of writing, USD/JPY is down 0.06% on the day at 162.09.